Keppel DC REIT distributions rise 11.7% in first nine months of 2026
Key Facts
Distribution per unit at data centre trust Keppel DC REIT rose 11.7% in the nine months ended September 2026, according to its official operational update presentation. Distribution per unit reached 8.571 Singapore cents, compared with 7.670 Singapore cents in the corresponding period a year earlier. The increase came as distributable income rose to S$227,996 thousand from S$195,301 thousand a year earlier. Distributable income grew 16.7%, outpacing the increase in the amount distributed per unit of the trust. Distributable income includes capital expenditure reserves, under the definition the trust uses in its results disclosure for the period.
On the operating front, the trust reported a 13.3% increase in gross revenue in the first nine months of the year compared with the same period in 2025. Revenue reached S$365,298 thousand, compared with S$322,440 thousand in the corresponding period. Net property income rose to S$316,794 thousand from S$280,213 thousand, an increase of 13.1% that nearly matched revenue growth. Meanwhile, financing costs totalled S$46,693 thousand, compared with S$36,444 thousand in the corresponding nine months. That represented a 28.1% increase in financing costs, outpacing growth in both gross revenue and net property income. The expansion in the trust's operating income thus coincided with a proportionately larger increase in financing costs during the reporting period.
In leasing, positive rental reversion on renewed and commencing leases was about 14% in the first nine months of 2026, according to the trust's operational update. Portfolio occupancy improved to 93.0% as of September 30, measured by lettable area. Occupancy had stood at 92.5% in the second quarter, with the portfolio showing an improvement by the end of the third quarter. Meanwhile, contracted power reached about 96% of revenue-generating capacity at the end of September. On borrowing, the average cost of debt was 2.6% in the first nine months of the year, according to figures released by the trust. The interest coverage ratio was 6.5 times for the trailing twelve months to September 30, 2026.
As part of the portfolio's expansion, Keppel announced in September 2026 that the trust was acquiring an 88.62% effective interest in two Japanese assets. The transaction announcement put the consideration for the stake at about 168.4 billion yen. That equates to approximately S$1,372.3 million, according to the approximate value cited in the acquisition announcement. The transaction was completed on October 1, 2026, after the end of the nine-month period covered by the reported operating results. Loh Hwee Long, chief executive of the trust's manager, said in the acquisition statement: "This acquisition reflects our disciplined approach to acquiring high-quality assets."
Attention at year-end is turning to the commencement of new contracts at the Gore Hill data centre, according to the timetable presented by the trust's management. Management said "revenue will more than double when the new contracts commence from the end of 2026". It linked the expected increase to those contracts taking effect at the centre. It added that there was potential for further revenue growth as part of its outlook for the impact of the new contracts. The trust's financial year ends on December 31, 2026, according to the financial calendar published on its website.